Sylacauga's SouthFirst Bancshares Inc. said it is suspending its dividend payout to shareholders, reflecting tough times for the banking industry.

"The current environment for financial institutions remains challenging," CEO Sandra Stephens said in a news release. "During the last few quarters, our dividends have exceeded our earnings. Until we return to normal levels of profitability, that is neither sustainable nor wise strategy."

Stephens said the board's decision was "not taken lightly." Directors, she added, saw it as a necessary step to "strengthen the company's balance sheet, enhance credit quality and provide ... greater financial flexibility."

SouthFirst, a thrift holding company, had been paying a quarterly dividend of 10 cents per share -- a sum equal to its earnings for the fiscal year completed in September. Stephens said the bank is not having liquidity concerns and remains well capitalized, as defined by regulators.